Official figures show the UK economy expanded by 0.4% in July, exceeding analyst forecasts of no growth and up from 0.3% in June, offering a boost to the government before the upcoming budget.
Key facts
- UK GDP rose 0.4% in July, according to the Office for National Statistics.
- The figure compares with 0.3% growth recorded in June.
- Analysts had predicted no growth for the month, the BBC reported.
- The BBC said an AI boom helped drive the surprise expansion.
- The growth comes ahead of John Healey's first budget next month.
The UK economy grew unexpectedly in July, according to figures released by the Office for National Statistics (ONS), providing a boost to the government ahead of next month’s budget. Gross domestic product (GDP) rose by 0.4%, up from 0.3% growth recorded in June.
The result came as a surprise to forecasters. According to the BBC, analysts had predicted no growth for the month, making the 0.4% expansion a notable beat against expectations.
The BBC reported that an AI boom helped drive the surprise growth, pointing to the sector as a contributing factor behind the stronger-than-expected performance.
According to the Guardian, the economy grew despite the fallout from the Iran war, describing the figures as welcome news for John Healey ahead of his first budget next month.
The Guardian noted that the unexpected GDP rise comes as borrowing costs and inflation risks mount ahead of the budget, framing the growth against a backdrop of continued economic pressures.
The timing of the figures is significant for the government, with the budget approaching and the data offering a positive signal amid wider concerns about the economic outlook.
Why it matters
GDP growth is a key measure of the economy's health, and a surprise expansion offers the government a favourable backdrop as it prepares its budget. The result also matters for households and businesses facing rising borrowing costs and inflation risks.
Frequently asked questions
How much did the UK economy grow in July?
The UK economy grew by 0.4% in July, according to figures from the Office for National Statistics, up from 0.3% growth in June.
Why was the growth described as a surprise?
According to the BBC, analysts had predicted no growth for the month, so the 0.4% expansion exceeded expectations.
What is driving the UK's growth?
The BBC reported that an AI boom helped drive the surprise growth in July.